Intel worldwide reseller channel organisation general manager and sales and marketing group vice-president, Steve Dallman, has acknowledged the company is "behind and playing catch-up" in the tablet and smartphone space, and said it must crank up its activity across the product segment to become more competitive.

While Intel has a presence in these areas, its bread and butter, from a sales perspective, is PC chips where sales are falling, as Agam Shah reports.

While Dallman said "the plan is to continue to do what we have done but faster, better and cheaper than other companies," an integral component of Intel's growth strategy is catered towards channel training. The goal is to enable channel partners to capitalise on new tablet and smartphone opportunities, which, in turn, will grow Intel's competitiveness in the booming market.

The software-driven upgrade cycle

The upcoming launch of Haswell, Intel’s fourth generation CPUs, will accelerate the upgrade cycle triggered by the introduction of Microsoft’s Windows 8 operating system. The software has caused a boom in touch-enabled devices which is bound to accelerate once Haswell hits shelves.

While similar upgrade cycles have taken place – such as Y2K, and more recently the move from Windows Vista to Windows 7 – this one will be different, according to Dallman.

“You cannot take a six, or even two-year-old system and move it effectively to Windows 8,” he said. “I think to really harness the productivity of Windows 8 you need to have touch.”

He explained that while many businesses will probably stay in Windows 7, according to reports, the opportunity is definitely there, particularly in the consumer space. Another contributing factor is that Microsoft is ending its support for Windows XP in April 2014.

For Intel, the timing is perfect, and that is its compelling message that partners can present to potential customers, Dallman said.

“At a time where [customers] are entering one of these software-driven upgrade cycles, we are launching a new architecture, and this architecture utilises the benefits of Windows 8 and provides investment protection because [customers] will be able to run multiple operating systems on it.”

Haswell will be available in four product SKUs: Y represents low power usage; the 15-Watt U model is set to be the mainstream item which Dallman believes the channel will use the most; the M and H variants are high-power CPUs catered for enthusiasts. All of these “have a stack of Pentiums and Celerons with them, meaning I can have my board and take my product lineup up and down the price points which reduces the cost to have multiple, industrial designs or chassis.”

Intel is also focusing on partner training.

The first part of this is to allow partners to assess the market and potential customer requirements, and then present the well-timed ‘compelling message’.

"We need to train partners on how to pick a tablet and the trade-offs associate to the hardware being used; why one camera works better than another, for example.

This will enable partners to take their customers through a plethora of platforms of products which can be used based on the workloads they have.

Another core training element is to provide partners with data on total cost of ownership.

“When you look at the bigger issue with systems that are three to five years old, one of the key things companies look at are TCO, and when they’re likely to have failure rates, especially on machines on which they no longer have warranties,” Dallman said. “When you look at how the costs have come down on these machines and what the cost of warranty is, it becomes a good bet companies will rather upgrade than pay for renewed warranty.”

Dallman said all of Intel’s new products are coming in the second half of the year right in front of the move, and the bulk of training will come alongside that, but did not reveal further details.

He claims that the new single core products are performing well across the board bar one or two benchmarks in which competitors’ dual-core devices are showing greater results. He added that when it comes to Intel’s dual- or quad-core products, the Intel product offers superior performance.

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